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ARAP TÜRK BANKASI A.Ş.
NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS AT 31 DECEMBER 2013
( Amounts expressed in thousands of Turkish Lira (“TL”) unless otherwise stated. )
CONVENIENCE TRANSLATION OF PUBLICLY ANNOUNCED CONSOLIDATED FINANCIAL STATEMENTS
ORIGINALLY ISSUED IN TURKISH, SEE NOTE I OF SECTION THREE
V. INFORMATION ON CONSOLIDATED FOREIGN CURRENCY EXCHANGE RATE RISK
Whether the Group is exposed to foreign exchange risk, whether the effects of this situation are estimated, and whether the
board of directors of the Bank sets limits for positions that are monitored daily
The Group complies with net general position-shareholder’s equity limits. The Bank has the possibility to borrow a significant amount
of foreign currency.Within the context of the market risk management work of the Risk Management Department, the Bank’s
Exchange rate risk is calculated and analyzed taking different dimensions of the issue in consideration. The Exchange rate risk is
measured according to market risk calculated using the Standard Method and is included in the capital adequacy ratio. For testing
effects of the unexpected exchange rate fluctuations on the Bank monthly basis stress test analysis are done. In addition, by classifying
the changes in risk factors different scenario analysis are done based on different exchange rate expectations. The sensitivity of assets,
liabilities and off-balance sheets against exchange rate are measured by an analysis on a monthly basis.
The magnitude of hedging foreign currency debt instruments and net foreign currency investments by using hedging
derivatives
The Group does not have any financial derivatives used for hedging.
Foreign exchange risk management policy
Transactions are being hedged according to the Central Bank of Turkey’s basket of currencies instantly. Managable and measurable
risks are taken in the scope of the regulatory limits.
Foreign exchange buying rates of the last five business days before the balance sheet date as publicly announced by the
Parent Bank are as follows
Date
US Dollars
EUR
24 December 2013
TL 2.0877
TL 2.8573
25 December 2013
TL 2.0812
TL 2.8466
26 December 2013
TL 2.0710
TL 2.8353
27 December 2013
TL 2.0957
TL 2.8693
30 December 2013
TL 2.1604
TL 2.9844
31 December 2013
TL 2.1343
TL 2.9365
The basic arithmetical average of the Parent Bank’s foreign exchange bid rate for the last thirty days
The basic arithmetical average of the Bank’s foreign exchange bid rate for December 2013 is TL 2.0630 for USD and TL 2.8266 for
EUR.